Satyam customers continue to bail as India's IT industry woes continue
Indian police armed with assault weapons surround Satyam CEO, Ramalinga Raju's vehicle as they take him to court. Raju is now locked up in a Central Prison.
Thanks to Mohtashim of ITtazee.com for bringing this to our attention. SanDisk is the latest in a long list of organizations, including the World Bank and others, terminating embattled Indian IT company, Satyam’s services. As we’ve mentioned here before, Satyam was at the epicenter of corporate espionage, fraud and other wrongdoings that have landed it’s founder and once-celebrated Indian entrepreneur, Ramalinga Raju, behind bars.
As reported by Mint, SanDisk contends that:
The financial difficulty faced by Satyam “has resulted in some project delays and loss of productivity,” the California-based firm said in a filing last week to US Securities and Exchange Commission.
Meanwhile, Mr. Murty, Satyam’s new CEO who was hurriedly brought in in the backdrop of the Raju-fraud scandal, contends that, “Our customer base remains intact and all our clients have chosen to stand by us during these challenging times”. How Mr. Murty defines “intact” is yet to be understood, because it is estimated that up to half of Satyam’s customer base has either already left or will soon leave and the Times of India has reported that the cash-crunch, visa and forex difficulties at Satyam are so severe that customers are being lost despite middle management’s efforts.
Meanwhile, Wipro and TCS, two other Indian outsourcing firms also affected by their own economic woes and scandals, have rejected all proposals to buy Satyam to shore up customers’ plummeting confidence in India’s IT outsourcers.
March 4th, 2009 at 8:29 am
Satyam’s customers are not just intact, Satyam is infact gaining new customers by the day. The market is thick with rumours and unsubstantiated blog posts such as your help spread the wrong word around.
March 4th, 2009 at 8:32 am
On your blog you have posted links from 8th January – presenting it as news. Those were speculations that you are posting on your blog as news.
March 4th, 2009 at 3:49 pm
Hello, thank you for this Posting. I am reading this Blog very often.
March 6th, 2009 at 10:59 pm
@Janit :
http://timesofindia.indiatimes.com/Business/India_Business/Satyam_managers_struggle_to_retain_customer_base/articleshow/3990969.cms
The Times of India, and the Wall Street Journal both say that Satyam is struggling to hold onto its customers and losing some. This is natural given the intensity of the crime committed by its top management (they are in jail btw). One should understand the deep implications of what has happened…
I would trust these news sources over what Satyam is saying itself, especially after its CEO has admitted to billions of dollars of fraud. I dont even want to imagine how much of Satyam management’s was involved, since the entire board was fired. The World Bank and Sandisk are global corporations who dont take such things lightly. And these are just the ones we know about……
Satyam has done to IT what Enron did to energy, and what Authur Anderson did to accounting. All three have brought intense disgrace to their disciplines. And I am angry at Satyam for bringing such bad reputation to the IT world. Now every manager, CEO, CIO is going to review their contracts with outsourcers, rethink WHAT they will outsource. Low cost is no longer important, since there are even possibilities that client’s data is being distributed illegally to others from India. Would a CEO that is lying, stealing, defrauding his own clients and employees be worried about selling/sharing private secure client data?
This is not the fault of honest, hard working Indian engineers. This mess lies at the doorstep of irresponsible, greedy, corrupt management, showing its stakeholders a reality of progress that never existed. And no one, including Infosys or Wipro want to touch Satyam with a 10 foot pole. Its quite Understandable. I dont think anyone wanted anything to do with Enron once it was clear what they were upto either.
May 26th, 2009 at 2:45 am
[...] Then, what was left of Satyam was to be taken over by a Government-appointed board, but there was a loss of customers and soon after came a significant drop in revenues for almost all major IT companies in India. But [...]
November 26th, 2009 at 3:15 pm
[...] There have been two developments recently which we felt were an important follow-up to the coverage TechLahore has given the Satyam story in the past. [...]